When Web Video Beats Old Media at its Own Game

If you tuned into a recent episode of Indy Mogul last week you’d probably have seen host Erik Beck mention the show’s sponsor, Universal Studios’ Death Race. And if you tuned into a 2007 episode of Indy Mogul last week you’d also have seen Beck tout Death Race there too.

That’s because Next New Networks, which produces and distributes the do-it-yourself visual effects show, has implemented technology from both Freewheel and Castfire that lets the web studio insert fresh ads, bumpers and host shout-outs for current ad campaigns into both current and older episodes in the Next New Networks catalog, imitating a longstanding practice in the traditional TV business.

The concept of dynamic ad insertion isn’t new to TV or the web, but the Next New Networks implementation is noteworthy for a number of reasons.

First, it’s enabling Next New Networks to realize as much as 25 percent more revenue for its ad campaigns, because about one-quarter of its 20 million monthly views come from its back catalog, said Tim Shey, one of the company’s co-founders. Now Next New Networks can run current campaigns, like the Death Race, in older episodes. Sure, technology vendors like DoubleClick have made a living by refreshing ads on the web, and other firms like YuMe Networks, VoloMedia and Kiptronic offer similar technology for web video. But the project is also the latest example of how new media is borrowing some of the best practices of oldteevee and making them better.

Dynamic ad insertion has been a staple of the local TV business for years. Cable and satellite operators both rely on technology to swap fresh ads in and out of local and national programming. Technology firms like Visible World have built their success on delivering targeted ad copy to specific zones in cable systems. But where dynamic ad insertion is most interesting is in the curious case of video-on-demand from cable operators.

TV programmers and advertisers were hotly pursuing advertising opportunities in VOD in 2003, 2004 and 2005 because of VOD’s targetability and the opt-in nature of the medium. But advertiser interest in the space dropped off sharply when broadband video took off two years ago — and that’s because one of the issues that has plagued VOD for years is the lack of dynamic ad insertion tools. Cable operators have only tested dynamic ad insertion in a handful of markets but to date there has not been a widespread implementation of the technology. As a result, ads in VOD programming usually live with the content for at least a month, which has scared off advertisers with time-sensitive campaigns.

So forward-thinking advertisers shifted their new media ad budgets to broadband and now broadband video is showing traditional TV that it can be a lot faster and better.